Market Update
U.S. Indexes Extend Weekly Gains, Crude Oil Rebounds
Barry Adams
09 Sep, 2022
New York City
Stocks on Wall Street are trading higher and benchmark indexes are set to extend weekly gains, after falling for three weeks in a row.
Investors are still questioning the Fed's commitment in fighting sky-high inflation, and rates have lagged for inflation for nearly two years.
Inflation has been rising for 22 months in a row and hovering near 9% but interest rates are lagging significantly near 2%.
Moreover, the longer the Fed takes in taming inflation, longer the duration of high rates will be needed.
Over the last two weeks, the Federal Reserve Chair Jerome Powell's forcefully reiterated central bank's commitment in fighting high inflation has left many on Wall Street unconvinced.
The S&P 500 index gained 0.3% to 4,030.25 and the Nasdaq Composite index added 0.2% to 11,945,23.
For the week, the two popular indexes are up 2%.
Futures of crude oil increased $2.61 to $86.16 a barrel and natural gas rose 14 cents to $8.06 a thermal unit.
Oil prices rose after news that the U.S. President Biden's administration is not looking to release more oil from the U.S. Strategic Petroleum Reserve.
Oil traders also reviewed Russia's threat to divert energy exports from Europe to Asia after G7 finance ministers proposed a price cap.
The yield on 2-year Treasury notes eased to 3.48%, 10-year Treasury notes declined 3.25% and 30-year bonds edged down to 3.43%.
In Europe, benchmark indexes rebounded a day after the European Central Bank lifted rates by 75 basis points, the largest rate hike in 23 years.
Crude oil is still set to close down for the second week in a row after the European Central Bank's aggressive rate hike and widening activity restrictions in China, the largest importer of the commodity.
The DAX index added 1.2% to 13,063.67, the CAC-40 index increased 1.3% to 6,206.08, and the FTSE 100 index advanced 1.4% to 7,366.16.
The euro jumped above the parity and traded at $1.005 and the British pound inched up to $1.16.
Bond Yields In Focus After Powell's Speech, Stocks Look Beyond Fed's Next Move
Barry Adams
08 Sep, 2022
New York City
Stocks lacked direction and investors digested another round of hawkish comments from the Fed Chair Powell and the ECB President Lagarde.
Federal Reserve Chairman Jerome Powell reiterated the central bank's commitment in fighting high inflation and warned that a smaller increase or a pause in rate hikes are not likely anytime soon.
Dave Buster's Quarterly Net Income Drops On Higher Expenses
Scott Peters
08 Sep, 2022
New York City
Dave & Buster's Entertainment Inc fell 10.3% to $39.47 after the restaurant operator reported better-than-expected revenues and comparable same store sales but net income fell more than estimated.
Total revenue in the second quarter ending in July increased 24% to record $468.4 million.
During the quarter, net income totaled $29.1 million or 59 cents a diluted share from $52.8 million or $1.07 a year ago.
Net income was $32.4 million or 90 cents per diluted share in the pre-pandemic second quarter of 2019.
Comparable sales in the second quarter at Dave & Buster's brand stores rose 9.6% compared to second quarter 2019.
Stock Buybacks
During the second quarter, the company repurchased 764,988 shares for $25 million under its $100 million authorized share repurchase program.
Third Quarter Look Ahead
The restaurant operator said its business has continued to improve through the first five weeks of the third quarter.
Consolidated comparable store sales increased 22.1%, reflecting 17.6% increase at Dave & Buster
American Eagle Outfitters Plans to Cut Staff and Expense After Quarterly Loss
Scott Peters
08 Sep, 2022
New York City
American Eagle Outfitters Inc dropped 10.2% to $10.14 after the apparel retailer's second quarter results fell short of expectations.
Revenues in the fiscal year 2022 second quarter ending in July were flat at $1.2 billion.
From a year ago, consolidated store revenue declined 2% and total digital revenue declined 6% and compared to pre-pandemic first quarter 2019, store revenue increased 1% and digital revenue increased 60%.
Gross margin declined to 30.9% from 42.1% a year ago largely on higher markdowns and rising freight costs.
In the quarter, the apparel retailer swing to a loss of $42.5 million from a profit of $121.5 million a year ago. equally driven by Aerie and American Eagle brands.
Inventory
At the end of the second quarter, total ending inventory at cost increased 36% to $687 million from $504 million last year,
Total apparel units increased only 22%, reflecting earlier receipts because of the improved supply chain flows.
Capital Expenditures
During the second quarter capital expenditures totaled $69 million and $128 million year-to-date.
For the year, management now expects to spend approximately $250 million, lower than the previous estimate of $275 million.
Stock Buybacks
The company repurchased 17 million shares as a part of its accelerated stock repurchase program and guided weighted average share count of 198 million in the third quarter.
Guidance and Outlook
The retailer guided third quarter gross margin is expected to be in the mid-thirties and in the fourth quarter in the low-thirties reflecting higher markdowns on more promotional retail environment.
The company also plans to cut store payroll, corporate expense, professional services and advertising and save $100 million annually, higher than the previous target of $60 million.
This translates to SG&A expenses remaining "relatively flat" to last year in the second-half, compared to previous guidance for "low-to-mid-single digit growth."
Movers: American Eagle Outfitters, Asana, Dave & Buster's, GameStop, McCormick, Regeneron Pharma
Barry Adams
08 Sep, 2022
New York City
Stocks on Wall Street see-sawed after the Fed Chairman Powell offered another forceful reiteration of his commitment in fighting high inflation and not back off from rate hikes till the inflation hovers near target rate of 2%.
The S&P 500 index was nearly unchanged at 3,978.11 and the Nasdaq Composite index dropped 0.4% to 11,749.75.
American Eagle Outfitters Inc dropped 10.2% to $10.14 after the apparel retailer's second quarter results fell short of expectations.
Revenues in the fiscal year 2022 second quarter ending in July were flat at $1.2 billion.
From a year ago, consolidated store revenue declined 2% and total digital revenue declined 6% and compared to pre-pandemic first quarter 2019, store revenue increased 1% and digital revenue increased 60%.
Gross margin declined to 30.9% from 42.1% a year ago largely on higher markdowns and rising freight costs.
In the quarter, the apparel retailer swing to a loss of $42.5 million from a profit of $121.5 million a year ago.
Asana Inc soared 24.5% to $23.66 after the company's latest quarterly results exceeded analysts expectations.
The communication software company said revenues in the second quarter ending in July surged 51% to $134.9 million.
Net loss in the quarter rose to $113.0 million or 59 cents a diluted share from $64.8 million or 40 cents a diluted share a year ago.
The company guided third quarter revenues in the range of $138.5 million and $139.5 million, an increase between 38% and 39%.
Dave & Buster's Entertainment Inc fell 10.3% to $39.47 after the restaurant operator reported better-than-expected revenues and comparable same store sales but net income fell more than estimated.
Total revenue in the second quarter ending in July increased 24% to record $468.4 million.
During the quarter, net income totaled $29.1 million or 59 cents a diluted share from $52.8 million or $1.07 a year ago.
Net income was $32.4 million or 90 cents per diluted share in the pre-pandemic second quarter of 2019.
Comparable sales in the second quarter at Dave & Buster's brand stores rose 9.6% compared to second quarter 2019.
GameStop Corp jumped 7.4% to $25.84 after the video game retailer sales revenues in the second quarter ending in July edged slightly lower to $1.13 billion from $1.18 billion a year ago.
Inventory at the end of the second quarter increased to $734.8 million from $596.4 million a year ago.
Net loss in the quarter expanded to $108.7 million from $61.7 million a year ago.
Stock jumped in today's trading after the company also announced a partnership with crypto exchange FTX.
The company is looking to diversify its business away from hardware retail and expand to the NFT marketplace, but the change has come at a significant expense.
At the end of the quarter, cash and cash equivalents had declined to $908.9 billion from $1.7 billion a year ago.
McCormick & Company dropped 8.2% to $78.0 after the company offered a gloomy outlook.
The flavor company said preliminary revenues in the third quarter ending in August increased 3% from a year ago.
Operating income in the quarter declined to $223 million from $265 million a year ago and earnings per share of 79 cents is estimated to match the results a year ago.
The company lowered its full-year fiscal 2022 revenues to increase 2% from the previous estimate between 3% and 5% and earnings per share in the range between $2.64 and $2.69 compared to $2.80 a year ago.
Regeneron Pharmaceuticals Inc soared 19% to $709.90 after the company said its eye treatment drug Eylea performed well in two key trials for patients with diabetic macular edema and wet age-related macular degeneration.
The following results were noted in the note released Thursday.
91% and 89% of diabetic DME patients were rapidly initiated and maintained on 12- and 16-week dosing intervals (without need for regimen modification) through week 48, respectively.
79% and 77% of wAMD patients were rapidly initiated and maintained on 12- and 16-week dosing intervals (without need for regimen modification) through week 48, respectively.
Jobless Claims Drop to 2-month Low
Barry Adams
08 Sep, 2022
New York City
Weekly initial jobless claims adjusted for seasonality declined 6,000 to 222,000 for the week ending on September 3, the Department of Labor reported Thursday.
Jobless claims were revised lower 4,000 to 228,000 in the previous week.
ECB Hikes Rates and Inflation Outlook, Lowers Growth Projections
Bridgette Randall
08 Sep, 2022
Frankfurt
The European Central Bank lifted its key lending rate 75 basis points following the 50 basis points increase in July.
The widely expected rate hike lifted the main refinancing rate to 1.25%. marginal lending facility to 1.5% and the deposit facility to 0.75%.
The central bank will also continue its asset purchase program, using the proceeds from maturing securities, and buy government bonds "as long as necessary."
Policymakers also guided rates to rise over the next policy meetings as long as high inflation persists.
Despite the hawkish comments from central bankers, many investors are skeptical that the policymakers will follow through and succeed in taming high inflation.
The revised rates will be implements from September 14,
At a press conference held after the rate-decision, ECB president Lagarde said that rates are still not high enough to tame inflation near the target rate of 2%.
The ECB lowered its growth projection and revised higher inflation estimates but cautioned that the economy is holding up because a record number of people have jobs and people are traveling again and spending money on services.
But businesses are suffering from persistent supply chain problems and record high energy prices and the economic outlook "for the coming months is worsening."
Moreover, the government programs to support the economic reopening after the pandemic have ended and the weakening global demand is also weighing on the economy.
As a result, businesses and consumer confidence is weak amid uncertain outlook.
Taking this into account the ECB revised higher inflation estimates to average 8.1% in 2022, 5.5% in 2023, and 2.3% in 2024 while growth projection was revised lower to 3.1% in 2022, 0.9% in 2023 and 1.9% in 2024.
The DAX index dropped 1.1% to 12,789.54, the CAC-40 index declined 0.4% to 6,084, and the FTSE 100 index was nearly unchanged at 7,242.61.
Fed's Hawkish Comments Fail to Dampen Market Advance
Barry Adams
08 Sep, 2022
New York City
Stocks traded briefly lower Thursday after hawkish comments from the Fed Chair Powell and the ECB President Lagarde.
Fed Chairman Jerome Powell reiterated the central bank's commitment in fighting high inflation and warned that a smaller increase or a pause in rate hikes are not likely anytime soon.
GitLab Revenues and Loss Surge
Scott Peters
07 Sep, 2022
New York City
GitLab Inc advanced 8.2% to $51.25 after the software developer reported smaller-than-expected loss in its latest quarter.
Total revenues in the quarter ending in July increased 74% to $101 million from $58 million a year ago.
The company added largest number of new base customers in the second quarter fiscal year 2023.
Net loss in the quarter increased to $61.4 million or 40 cents from $40.7 million or 75 cents a year ago.
The company guided third quarter revenues in the fiscal year 2023 in the range between $105 million and $106 million and full-year fiscal 2023 between $411 million and $414 million.
Customers with more than $5,000 average revenue run rate increased 61% to 5,864 and with more than $100,000 jumped 55% to 593.
Elevated U.S. Trade Deficit Eases In July
Brian Turner
07 Sep, 2022
New York City
U.S. trade deficit declined $10.2 billion or 12.6% to $70.6 billion in July, the Bureau of Economic Analysis reported Wednesday.
Total exports rose 0.2% to record $259.3 billion driven by higher service exports offsetting a decline in merchandise shipments.
Total imports fell 2.9% to $329.9 billion after a decline in imports of industrial supplies and consumer goods offset an increase in shipments of automotive vehicles and parts.
The deficit with China fell to $33 billion, a decline of $3.9 billion after exports rose to $12.8 billion and imports eased to $45.8 billion.
In the second quarter 2022, the United States recorded trade surplus and deficits in goods and services with the following countries and regions.
Trade Surplus - Second Quarter 2022
South and Central America - $31.4 billion
The Netherlands - $11.5 billion
Singapore - $9.6 billion
Brazil - $9.4 billion
Australia - $6.8 billion
Hong Kong - $6.5 billion
U.K. - $4.3 billion
Belgium - $2.5 billion
Switzerland - $1.8 billion
Trade Deficit - Second Quarter 2022
China - $100.8 billion
European Union - $37.4 billion
Mexico - $33.3 billion
Vietnam - $32.7 billion
Canada - $20.9 billion
Germany - $18.2 billion
Japan - $15.2 billion
India - $14.8 billion
Taiwan - $11.8 billion
Italy - $11.0 billion
South Korea - $9.9 billion
Malaysia - $8.8 billion
Ireland - $4.6 billion
France - $3.9 billion
Israel - $2.5 billion
Saudi Arabia - $2.2 billion
U.S. Stocks Advance Overcoming Rate Hike Worries, Oil Plunges 6%
Barry Adams
07 Sep, 2022
New York City
Stocks on Wall Street advanced after crude oil prices plunged nearly 6% easing pressure on high inflation.
For today, investors set aside the worries of a larger rate hike later in the month after crude oil prices plunged.
The sharp fall in the oil stoked the optimism on Wall Street investors bid up recently beaten down tech stocks.
However, central banks are set to lift rates this month with the focus on the U.S. Federal Reserve and the European Central Bank.
The European Central Bank is set to lift its key lending rate by as much as 75 basis points on Thursday and the U.S. Federal Reserve is expected to match the hike at its next two-day policy meeting ending on Sep 21.
Two days ago, as expected the Reserve Bank of Australia hiked its key lending rate by 50 basis points to 2.35%.
The latest hike follows three increases of similar size in the previous three months and 25 basis points increase in May, lifting the rates to the levels last seen in January 2015.
The Bank of Canada lifted its overnight lending rate by 75 basis points to 3.25%, meeting the market expectations.
The latest rate hike is the fifth consecutive increase in a row, lifting the lending rates to a high not seen since 2008.
Crude oil prices declined in New York and in international markets on the falling demand worries and rising dollar.
The oil price fell to the lowest level since Russia's invasion of Ukraine on February 24 on the worries that the economic slowdown may dampen the demand.
Only a day ago in a nod to the decline in oil demand, the OPEC+ announced to cut its production target by 100,000 barrels a day.
Futures of West Texas Intermediate crude oil declined 5.7% to $81.88 a barrel and natural gas eased 31 cents to $7.82 a thermal unit.
The yields on 2-year notes fell to 3.41%, 10-year Treasury notes eased to 3.27% and 30-year bond fell to 3.42%.
The S&P 500 index increased 1.8% to 3,979.83 and the Nasdaq Composite index advanced 2.2% to 11,791.90.
Elevated U.S. Trade Deficit Eases In July
U.S. trade deficit declined $10.2 billion to $70.7 billion in July, the Bureau of Economic Analysis reported Wednesday.
Total exports rose 0.2% to record $259.3 billion driven by higher service exports offsetting a decline in merchandise shipments.
Total imports fell 2.9% to $329.9 billion after a decline in imports of industrial supplies and consumer goods offset an increase in shipments of automotive vehicles and parts.
The deficit with China fell to $33 billion, a decline of $3.9 billion after exports rose to $12.8 billion and imports eased to $45.8 billion.
European Markets Anticipate Rate Hike On Thursday
European markets advanced and energy prices in the region fell for the third day in a row.
Investors are bracing another round of rate hike as central banks in the U.S., Europe and Asia target inflation in a coordinated fashion.
The European Central Bank is set to lift its key lending rate by as much as 75 basis points and the U.S. Federal Reserve is expected to match the hike at its next two-day policy meeting ending on Sep 21.
The National Bank of Poland lifted its key lending rate by 25 basis points to 6.75%, marching the market expectations.
The DAX index increased 0.4% to 12,915.97, the CAC-40 index rose 0.02% to 6,105.92, and the FTSE 100 index fell 0.9% to 7,237.83.
Brent crude oil prices fell 4.9% to $88.26 a barrel and TTF gas prices plunged 11.4% to 213.81 euros a megawatt a hour.
The U.S. dollar continued to rise and the euro dropped to $0.994 and the British pound eased to $1.147, the lowest in 37 years as investors anticipate inflation to accelerate and economic conditions to weaken.
Rising current account deficit and dropping investor confidence has hammered the pound 15% against the U.S. dollar this year.
The British pound is set to test its record low of $1.02 reached in February 1985.
Eurozone GDP Growth Revised Higher
The euro area economic growth was faster than previously estimated, according to the latest revision from Eurostat released Wednesday.
Preliminary estimate was released on Aug 17.
GDP growth in the second quarter was revised higher to 0.8% from 0.6% on a sequential basis. The economy expanded at a 4.1% from the previous estimate of 3.9% from a year ago.
The eurozone economy in the first quarter rose 0.7% from the previous quarter and jumped 5.4% from a year ago.
German industrial production fell 0.3% in July after rising 0.8% in June, Destatis reported Wednesday.
Industrial production declined 1.1% after easing 0.1% in June on an annual basis,
In stock trading, resource stocks led the decliners after Brent crude oil prices fell 4.9% and natural gas prices dropped 11%.
Glencore, Anglo American, Antofagasta and BHP Group dropped between 2% and 3%.
Asian Markets Turn Lower On Recession Worries
Asian markets in Wednesday's trading turned lower on recession worries despite the falling energy prices for the third day in a row.
Indexes in China closed marginally down after export growth slowed to 7.1% in August from 18% in July, General Administration of Customs in Beijing said Wednesday.
Import growth fell to 0.3% in August from 2.3% in July.
The Shanghai Stock Exchange Composite Index inched up 2.85 to 3,246,29 and the Hang Seng Index fell 0.8% to 19,044.30.
In Tokyo, investors focused on the rapid decline in yen for the third day in a row. The yen dropped 1% to 144,32, prompting Finance Minister Shunichi Suzuki to caution that the government will be ready to act, if needed.
The Nikkei 225 Index fell 0.7% to 27,430.30 and the broader Topix declined 0.6% to 1,915.65.
With weak markets in Asia and Europe, popular indexes in India eased in the final hour of trading on Wednesday.
The Sensex closed down 168.08 points or 0.28% to 59,028.91 and the Nifty index declined 31.20 points or 0.18% to 17,624.40
The KOSPI Index in Seoul, Korea declined 1.4% to 2,376.46 after the won dropped to a 13-year low of 1,377 against a dollar.
Semiconductor makers and steel companies led the decliners in Seoul trading.
In Sydney, Australia, the ASX 200 Index plunged 1.4% to 6,729.30 after energy and commodities prices eased.
The Australian dollar dropped to a two-year low to $1.477 despite the Reserve Bank of Australian lifting its key lending rate by 50 basis points this week.
Asian Markets Turn Lower On Recession Worries
Arjun Pandit
07 Sep, 2022
Mumbai
Asian markets in Wednesday's trading turned lower on recession worries despite the falling energy prices for the third day in a row.
Indexes in China closed marginally down after export growth slowed to 7.1% in August from 18% in July, General Administration of Customs in Beijing said Wednesday.
Import growth fell to 0.3% in August from 2.3% in July.
The Shanghai Stock Exchange Composite Index inched up 2.85 to 3,246,29 and the Hang Seng Index fell 0.8% to 19,044.30.
In Tokyo, investors focused on the rapid decline in yen for the third day in a row. The yen dropped 1% to 144,32, prompting Finance Minister Shunichi Suzuki to caution that the government will be ready to act, if needed.
The Nikkei 225 Index fell 0.7% to 27,430.30 and the broader Topix declined 0.6% to 1,915.65.
With weak markets in Asia and Europe, popular indexes in India eased in the final hour of trading on Wednesday.
The Sensex closed down 168.08 points or 0.28% to 59,028.91 and the Nifty index declined 31.20 points or 0.18% to 17,624.40
The KOSPI Index in Seoul, Korea declined 1.4% to 2,376.46 after the won dropped to a 13-year low of 1,377 against a dollar.
Semiconductor makers and steel companies led the decliners in Seoul trading.
In Sydney, Australia, the ASX 200 Index plunged 1.4% to 6,729.30 after energy and commodities prices eased.
The Australian dollar dropped to a two-year low to $1.477 despite the Reserve Bank of Australian lifting its key lending rate by 50 basis points this week.
Europe Movers: Barratt Developments, James Fisher, SGL Carbon, Siemens Energy, Uniper
Bridgette Randall
07 Sep, 2022
Frankfurt
European markets advanced and energy prices in the region fell for the third day in a row.
Investors are bracing another round of rate hike as central banks in the U.S., Europe and Asia target inflation in a coordinated fashion.
The European Central Bank is set to lift its key lending rate by as much as 75 basis points and the U.S. Federal Reserve is expected to match the hike at its next two-day policy meeting ending on Sep 21.
The DAX index increased 0.4% to 12,915.97, the CAC-40 index rose 0.02% to 6,105.92, and the FTSE 100 index fell 0.9% to 7,237.83.
Brent crude oil prices fell 4.9% to $88.26 a barrel and TTF gas prices plunged 11.4% to 213.81 euros a megawatt a hour.
The U.S. dollar continued to rise and the euro dropped to $0.994 and the British pound eased to $1.147, the lowest in 37 years as investors anticipate inflation to accelerate and economic conditions to weaken.
Rising current account deficit and dropping investor confidence has hammered the pound 15% against the U.S. dollar this year.
The British pound is set to test its record low of $1.02 reached in February 1985.
In stock trading, resource stocks led the decliners after Brent crude oil prices fell 4.9% and natural gas prices dropped 11%.
Glencore, Anglo American, Antofagasta and BHP Group dropped between 2% and 3%.
Repsol SA declined 4% to 12.93 euros and the Spanish petrochemicals company said it has agreed to sell 25% stake in its upstream business for $4.8 billion to an energy investment company EIG Global Energy Partners.
Siemens Energy SA declined 3.3% to 13.67 euros after the company and Russia traded blames linked to the Nord Stream 1 pipeline maintenance.
Russia blamed Siemens Energy for the lack of maintenance and Siemens denied the allegations.
Uniper SE plunged as much as 5% before recovering to close down 0.5% to 4.71 euros after the German utility company said natural gas prices could go higher.
SGL Carbon SE gained 12% to 7.40 euros after the company revised higher fiscal year revenues to 1.2 billion euros from 1.1 billion euros on account of better performance in its carbon fibers unit.
The company also revised higher its operating earnings in the range between 170 million and 190 million euros from the previous range between 130 million and 150 million euros.
James Fisher & Sons declined 6.2% to 286 pence after the marine engineering services provider reported a decline in first-half profit.
Revenues in the first-half ending in June increased 2% to 238.4 million pounds and net income plunged 28% to 2 million pounds from 13.6 million pounds a year ago.
However, the company said second-half is expected to be "materially stronger" than the first and the full-year underlying operating profit "is expected to be broadly in-line with 2021."
Barratt Developments PLC declined 1.2% to 417.0 pence after the home builder said home completions recovered to the pre-pandemic level.
Barratt said revenues in the fiscal year ending in June rose 9.5% to 5.27 billion pounds and completed homes increased 3.9% to 17,908.
Profit-before-tax declined 21% to 642.3 million pounds and basic earnings per share dropped 22% to 50.6 pence from 64.9 pence a year ago.
European Stocks Inch Up, Eurozone Growth Revised Higher
Bridgette Randall
07 Sep, 2022
Frankfurt
European markets advanced and energy prices in the region fell for the third day in a row.
Investors are bracing another round of rate hike as central banks in the U.S., Europe and Asia target inflation in a coordinated fashion.
The European Central Bank is set to lift its key lending rate by as much as 75 basis points and the U.S. Federal Reserve is expected to match the hike at its next two-day policy meeting ending on Sep 21.
The National Bank of Poland lifted its key lending rate by 25 basis points to 6.75%, marching the market expectations.
Two days ago, the Reserve Bank of Australia hiked its key lending rate by 50 basis points to 2.35% as expected.
The latest hike follows three increases of similar size in the previous three months and 25 basis points increase in May, lifting the rates to the levels last seen in January 2015.
The Bank of Canada lifted its overnight lending rate by 75 basis points to 3.25% meeting the market expectations.
The latest rate hike is the fifth consecutive increase in a row, lifting the lending rates to a high not seen since 2008.
The DAX index increased 0.4% to 12,915.97, the CAC-40 index rose 0.02% to 6,105.92, and the FTSE 100 index fell 0.9% to 7,237.83.
Brent crude oil prices fell 4.9% to $88.26 a barrel and TTF gas prices plunged 11.4% to 213.81 euros a megawatt a hour.
The U.S. dollar continued to rise and the euro dropped to $0.994 and the British pound eased to $1.147, the lowest in 37 years as investors anticipate inflation to accelerate and economic conditions to weaken.
Rising current account deficit and dropping investor confidence has hammered the pound 15% against the U.S. dollar this year.
The British pound is set to test its record low of $1.02 reached in February 1985.
Eurozone GDP Growth Revised Higher
The euro area economic growth was faster than previously estimated, according to the latest revision from Eurostat released Wednesday.
Preliminary estimate was released on Aug 17.
GDP growth in the second quarter was revised higher to 0.8% from 0.6% on a sequential basis. The economy expanded at a 4.1% from the previous estimate of 3.9% from a year ago.
The eurozone economy in the first quarter rose 0.7% from the previous quarter and jumped 5.4% from a year ago.
German industrial production fell 0.3% in July after rising 0.8% in June, Destatis reported Wednesday.
Industrial production declined 1.1% after easing 0.1% in June on an annual basis,
In stock trading, resource stocks led the decliners after Brent crude oil prices fell 4.9% and natural gas prices dropped 11%.
Glencore, Anglo American, Antofagasta and BHP Group dropped between 2% and 3%.
Movers: Baxter, Coupa Software, Dexcom, Gitlab, Ross Stores, Twitter, Starbucks, United Airlines
Barry Adams
07 Sep, 2022
New York City
Stocks accelerated gains after three weeks of losses as investors surmised the economy is strong enough to handle rising interest rates.
Crude oil prices declined in New York and in international markets on the falling demand worries and rising dollar.
The oil price fell to the lowest level since Russia's invasion of Ukraine on February 24.
Futures of West Texas Intermediate crude oil declined 3% to $84.21 a barrel and natural gas eased 20 cents to $7.92 a thermal unit.
The yields on 2-year notes fell to 3.47%, 10-year Treasury notes eased to 3.28% and 30-year bond fell to 3.44%.
The S&P 500 index increased 1.1% to 3,951.89 and the Nasdaq Composite index advanced 1.2% to 11,690.87.
Baxter International soared 5.7% to $57.79 after the company made a presentation to investors at the Wells Fargo Healthcare Conference 2022 in Boston, Massachusetts.
On July 28, the company reported second quarter revenues rose 21% to $3.75 billion and net income declined to $252 million or 50 cents a share from $298 million or 59 cents a a year ago.
Baxter had also estimated full-year 2022 earnings per share in the range of $1.82 and $1.92 and revenues to increase in "the high teens."
Coupa Software Inc soared 15.6% to $64.52 after the company's latest quarterly results exceeded market expectations. The company also guided a stronger full-year outlook.
Dexcom, Inc rose 5.5% to $86.57 after the company made a presentation to investors at a healthcare conference organized by Wells Fargo in Boston, MA.
On July 28, the company said second quarter revenues increased 11% to $696 million and tightened its annual revenues range to between $2.86 billion and $2.91 billion.
Net income in the second quarter was $50.9 million or 12 cents a diluted share compared to $78.4 million or $0.19 a diluted share a year ago.
Gitlab Inc advanced 8.2% to $51.25 after the software developer reported smaller-than-expected loss in its latest quarter.
Total revenues in the quarter ending in July increased to $101 million from $58 million a year ago.
Net loss in the quarter increased to $61.4 million or 40 cents from $40.7 million or 75 cents a year ago.
The company guided third quarter revenues in the fiscal year 2023 in the range between $105 million and $106 million and full-year fiscal 2023 between $411 million and $414 million.
Ross Stores increased 5.5% to $91.49 in active trading and a week ago the discounted retail chain operator guided third quarter earnings per share between 72 cents and 83 cents.
Starbucks Corporation rose 3.3% to $87.30 ahead of the coffee chain retailer's investor day on September 13,
The company recently appointed Laxman Narasimhan as its next chief executive from October 1, 2022 and will work closely with Howard Schultz, interim CEO, before assuming full-responsibilities and joining the Board on April 1, 2023.
Previously, Indian-born Narasimhan served as chief executive officer of Anglo-Dutch consumer goods company Reckitt Benckiser Inc for three years.
Twitter Inc increased 5.5% to $40.86 after a Delaware court disallowed Elon Musk's request to postpone the trial involving his decision to abandon a $44 billion deal to acquire the company.
However, the court permitted Musk to add claims against the social media platform company filed by a whistleblower.
United Airlines Holdings Inc added 3.3% to $37.79 after the company revised higher its third quarter revenues outlook on stronger Summer travel demand.
Third quarter revenues are estimated to increase 12% above the same quarter in 2019 from its previous estimate of 11% increase from the pre-pandemic levels.